What happened

The Kenya Revenue Authority (KRA) announced that, effective 1 November, it will block the clearance of all imported and exported cargo that does not have a verifiable insurance certificate. The directive applies to shipments arriving at or leaving any Kenyan port, airport or inland clearance point. KRA officials say the policy is intended to curb fraudulent claims and ensure that shippers are protected against damage, loss or theft while goods are in transit. Importers and exporters are therefore required to secure appropriate cargo insurance before submitting their clearance documents.

Context and background

KRA has long been responsible for overseeing customs duties, import taxes and the overall integrity of Kenya’s trade corridors. In recent years, the authority has reported a rise in cargo‑related disputes where uninsured goods suffered damage, yet claimants sought compensation from the government or from other parties. These incidents have strained the customs clearance system and increased the workload of KRA officers who must investigate each case. The decision to enforce insurance compliance follows a series of internal audits that highlighted gaps in documentation and the need for stricter enforcement.

Insurance for cargo is not a new requirement in Kenya; the Kenya Insurance Association (KIA) and the Kenya Maritime Authority have long advocated for mandatory coverage to protect both importers and the national economy. However, enforcement has been inconsistent, with many small‑scale traders relying on informal arrangements that lack proper documentation. By making insurance a non‑negotiable clearance condition, KRA aligns its procedures with international best practices observed in major trading hubs such as Singapore and Rotterdam.

The move also coincides with the government’s broader agenda to improve revenue collection and reduce trade‑related fraud. Earlier in the year, KRA introduced electronic single‑window systems to streamline documentation, and it has been rolling out risk‑based targeting to focus inspections on high‑value or high‑risk consignments. The insurance mandate complements these initiatives by adding another layer of verification before goods move through the supply chain.

Compared with what is normal

Historically, KRA has allowed cargo to clear even if insurance paperwork was incomplete, provided the shipper could produce a written declaration or a post‑clearance guarantee. In practice, this meant that many small traders cleared goods without formal coverage, relying on the goodwill of insurers or on ad‑hoc agreements. The new policy eliminates that flexibility. Below is a brief comparison:

• Previous practice: Missing or informal insurance could be accepted after additional scrutiny, often leading to delays of a few days.
• New rule (from 1 Nov): Any cargo lacking a verifiable insurance certificate will be stopped at the point of clearance, with no exceptions.
• Impact on timelines: Traders who previously cleared within 24‑48 hours may now face a 2‑day or longer hold‑up if insurance is not secured in advance.

Why it matters

For Kenyan SMEs that rely on imported raw materials or export finished products, the change directly affects cash flow and operational planning. Without insurance, a single consignment can be held indefinitely, tying up working capital and potentially causing production delays. Moreover, the risk of cargo loss or damage shifts back to the trader, who may have to bear the full cost of any incident. On a macro level, the policy aims to protect the national economy by reducing the number of uninsured losses that can translate into higher insurance premiums and increased claims against public funds.

Practical steps

• Verify that your freight forwarder or logistics partner provides a valid cargo insurance certificate before the goods are loaded for transport.
• Update internal checklists to include insurance verification as a prerequisite for filing customs clearance documents.
• Engage with a reputable insurance broker early in the procurement cycle to obtain a quote and policy that meets KRA’s requirements.
• Train your finance or compliance team on the new clearance rules and ensure they keep digital copies of insurance certificates ready for electronic submission.

Tax Planning & Compliance services at Beavoren Ventures can help your business align with the new KRA insurance mandate, ensuring that documentation is complete and that you avoid costly clearance delays.

Book a consultation with Beavoren Ventures today and let us handle your compliance, books, and advisory in one place.

Disclaimer: This article is informational and does not constitute formal tax, audit or legal advice. For guidance specific to your circumstances, please contact Beavoren Ventures.